Hyper-v can’t open created VM

Windows 2008 Hyper-V worked fine.  I was able to create and run virtual machines.  I decided to upgrade to Windows 2008 R2 RTM for lab testing.  Available articles said you can leave Hyper-V installed in Windows 2008 even though there is a warning during installation of R2.  I exported a VM for importing back into W2008 R2.  Installed W2008R2.  The imported VM will not start.  Created new VM’s and they will not start.  Event log shows two errors occurring whenever an attempt is made to start a VM.  Event log follows. 

I have spent a couple of days trying to figure out what happened.  Nothing changed in the BIOS to disable VM’s and the upgrade went without error.  I sure could use some words of wisdom from someone who might know what the problem is.  Research indicates the problem is security related, but I can’t find specific information about security settings for Hyper-V in W2008 R2.  The Hyper-V folders holding files have full privileges for System and Administrator and the Virtual Machines group is assigned successfully when a VM is created.  I am working under the administrator account.  The server is a domain controller.  I also removed Hyper-V in W2008 R2 and reinstalled it, but that had no effect.

Log Name:      Microsoft-Windows-Hyper-V-Worker-Admin
Source:        Microsoft-Windows-Hyper-V-Worker
Date:          9/12/2009 2:13:15 PM
Event ID:      3040
Task Category: None
Level:         Error
Keywords:     
User:          NETWORK SERVICE
Computer:      PNS-SERVER.pronetserv.lcl
Description:
‘Symantec AV Manager’ could not initialize. (Virtual machine ID 9C99D5D2-34A1-45A5-814D-30F9145D3D6D)

Log Name:      Microsoft-Windows-Hyper-V-Worker-Admin
Source:        Microsoft-Windows-Hyper-V-Worker
Date:          9/12/2009 2:13:15 PM
Event ID:      3080
Task Category: None
Level:         Error
Keywords:     
User:          NETWORK SERVICE
Computer:      PNS-SERVER.pronetserv.lcl
Description:
‘Symantec AV Manager’ could not create or access saved state file F:\Hyper-V\Symantec AV Manager\Virtual Machines\9C99D5D2-34A1-45A5-814D-30F9145D3D6D\9C99D5D2-34A1-45A5-814D-30F9145D3D6D.vsv. (Virtual machine ID 9C99D5D2-34A1-45A5-814D-30F9145D3D6D)

    Solution:
     Hello,

    I had the same problem after Win2k8 RTM to R2 upgrade.

    In my case it was NTFS permissions problem (which actually wasn’t a problem for Hyper-V in Win2k8 RTM).

    Previously, I have changed default D: drive permissions to only allow ‘Full Access’ for Administrators and SYSTEM group to root of the D: drive.

    I solved my problem by adding ‘Authenticated Users’ group to the root of D: drive and allowed ‘List’ permission with a scope ‘This folder only’ (You should do this via Advanced permission management).
    Just in case: do NOT check ‘replace all child object permissions’, otherwise you will need to recreate all your VMs configurations from scratch.

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